Balancer, a decentralized exchange and automated portfolio management protocol, has announced that its v3 upgrade is now live.

The Balancer (BAL) team said v3 is an upgrade designed to drive the next growth chapter of its decentralized finance ecosystem, with key focus being liquidity optimization and to incentivize developers.

Balancer v3 introduces 100% boosted pools and includes a major partnership with DeFi behemoth Aave (AAVE).

100% Boosted Pools

Balancer v3’s 100% Boosted Pools provides for a passive liquidity solution where underlying capital goes to external yield markets. However, it maintains liquidity for swaps. This means liquidity providers will, with just one click, be able to maximize yield as they participate in one of decentralized finance’s most efficient markets.

Aave will power v3’s initial Boosted Pools, Balancer told crypto.news in a press release. The protocol expects to add more partners as it expands the solution across DeFi.

Aave will integrate 100% Boosted Pools as Balancer v3’s launch partner, leveraging the integration to bring unparalleled liquidity optimization to ecosystem users. Balancer and Aave seeks to transform the broader DeFi market through Balancer’s automated market maker technology and Aave’s infrastructure.

“By combining Aave’s and Balancer’s strengths, the new Aave V3 Boosted Pools empower users with enhanced capital efficiency and simplified yield generation,” Stani Kulechov, founder of Aave Labs, said.

The integration offers benefits such as greater returns, access to supply and swap functions, and low gas costs.

Other than integration with Aave, Balancer announced its v3 rollout comes with multiple key features. These include custom pool types designed to help projects build custom and Hooks Framework that help unlock new liquidity management possibilities.

This functionality for hooks include use cases such as dynamic liquidity management for real-time fee adjustments or yield optimization and tailored pool behavior for trading and investment strategies.

Projects that are looking to tap into v3 include liquidity pools platform Gyroscope and on-chain funds protocol QuantAMM.